WEBVTT - Surveillance: Merkel Has Been A Monolith, Schick Says

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<v Speaker 1>Yeah, Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keene

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<v Speaker 1>Jay Ley. We bring you insight from the best in economics, finance, investment,

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<v Speaker 1>and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud,

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<v Speaker 1>Bloomberg dot Com, and of course on the Bloomberg. I

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<v Speaker 1>want to bring in Michael Shell now market Field Asset

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<v Speaker 1>Management Shairman portfolio manager and CEO, which joins us here

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<v Speaker 1>in New York. Good morning to Michael. Good morning. Let's

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<v Speaker 1>get to the IBM deal. Ten times sales for red

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<v Speaker 1>half thirty three billion dollars. What does red Hat do

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<v Speaker 1>and why does IBM need them? Is this all about

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<v Speaker 1>the cloud? I think it's all about IBM trying to

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<v Speaker 1>catch up with a technology cycle that's you know, left

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<v Speaker 1>it trailing in the dust. Sounds a little late to me, Michael,

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<v Speaker 1>I think it's it's extremely late, and and you know,

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<v Speaker 1>somewhat despert. I'm not enough of an expert to tell

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<v Speaker 1>you whether it's a quote unquote good deal or not,

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<v Speaker 1>or what exactly that happenings to the table. But you know,

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<v Speaker 1>when I look at IBM, I look at a company

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<v Speaker 1>that used to be Triple A and is now single

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<v Speaker 1>a um and And nineteen years ago was one of

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<v Speaker 1>the absolute dominant corporate American companies. In fact, for what

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<v Speaker 1>I remember, it even managed the first eighteen months of

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<v Speaker 1>the bear market, and we're still near it's high um

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<v Speaker 1>and And since Venners has you know, in absolute terms,

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<v Speaker 1>maybe not absolutely disastrous, but but in relative terms kind

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<v Speaker 1>of looks like Wegg did a year ago. What happens

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<v Speaker 1>if they slipped to some form of triple B or

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<v Speaker 1>flavor of triple B. I mean, this is an iconic

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<v Speaker 1>company of the phrase bet. The company has been seen

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<v Speaker 1>three and four times at PC tobaccle the death of

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<v Speaker 1>the near death, I should say, of But as you

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<v Speaker 1>correctly state, Michael, they've got an a rating of a

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<v Speaker 1>triple A perception and one day they're going to be

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<v Speaker 1>B or whatever. What happens when a company does that

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<v Speaker 1>shifts from ash to be ish. You know, I think

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<v Speaker 1>it's okay to debase your balance sheet if you are

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<v Speaker 1>enriching your shareholders. It may not be the way I

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<v Speaker 1>would want to run a company, but I think you

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<v Speaker 1>can make an argument, but that's in your in your

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<v Speaker 1>shareholders interest in your bond holders, you know, provided you

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<v Speaker 1>keep up at that sort of triple B plus level

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<v Speaker 1>haven't really been damaged, haven't really been damaged too greatly.

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<v Speaker 1>But you know, if we went into a technology downtread

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<v Speaker 1>um and IBM is teaching between as you say, that

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<v Speaker 1>A level and that triple B level and spreads a widening.

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<v Speaker 1>You know, those sorts of bombs don't get treated well

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<v Speaker 1>by markets. What did Mr mL get wrong? If you

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<v Speaker 1>were having a cup of coffee with Mrs Romedy and

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<v Speaker 1>Bloomberg will speak to Mrs Romedy here in a bid

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<v Speaker 1>uh if if what would you say to Ms Romedi

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<v Speaker 1>about lessons learned from Mr Immelt? You know, it's it's

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<v Speaker 1>I think both of them took over companies that exactly

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<v Speaker 1>there a long time. I mean, I mean they were

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<v Speaker 1>and did very very difficult situations by the time management look.

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<v Speaker 1>I think m L in retrospect panicked after the OA

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<v Speaker 1>financial crisis and got part of a crucial party, got

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<v Speaker 1>bit of a crucial part of g which was the

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<v Speaker 1>financial business, and the company has never really been able

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<v Speaker 1>to rebuild itself since. You know, in the case of IBM, yes,

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<v Speaker 1>as I say, it's it's been a wonderful technology cycle,

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<v Speaker 1>and you have to ask questions of somebody that came

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<v Speaker 1>into the cycle and in an okay position like IBM

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<v Speaker 1>and hasn't managed to innovate, hasn't managed to take advantage

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<v Speaker 1>of any of the major trends that you've seen take place. John,

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<v Speaker 1>I get a chart out. I put a Michael shul

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<v Speaker 1>chart on the Chinese stock market. That was just the

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<v Speaker 1>usual show brilliance. But I went back and looked at

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<v Speaker 1>IBM history, which I lived. But I'd forgotten the boom

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<v Speaker 1>of the early eighties with the IBM PC and then

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<v Speaker 1>John the absolute crater. I'd forgotten the trouble IBM was

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<v Speaker 1>in twenty five years ago, even the last ten years.

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<v Speaker 1>They think about Microsoft, think about the transition that Microsoft

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<v Speaker 1>has managed to make of Santa and Adela. Now that's

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<v Speaker 1>the way it should have been done at IBM, you

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<v Speaker 1>would assume, Michael, Yes, But I you know, Microsoft had

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<v Speaker 1>one key advantage, which was they were earning tremendous amounts

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<v Speaker 1>of cash for whole way through it and never really

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<v Speaker 1>had to touch their balance sheet. That the trouble with Microsoft,

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<v Speaker 1>as they had a fantastic legacy business and they didn't

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<v Speaker 1>really noticed, they really didn't understand what to do with it.

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<v Speaker 1>You know, IBM unfortunately seems to have a deteriorating legacy

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<v Speaker 1>business and doesn't quite know what to do about it. Well,

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<v Speaker 1>IBM stocks down about five. I love the way many

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<v Speaker 1>people will refer to this, Michael as a cash deal,

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<v Speaker 1>and it's a cash deal for Red Hat. For IBM,

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<v Speaker 1>it's something else. It's a debt deal, right correct, It

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<v Speaker 1>will be financed by debt. That's the situation for the

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<v Speaker 1>big tech companies. Looking at the situation right now for

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<v Speaker 1>the broader market is interesting that we're about together the

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<v Speaker 1>world's second largest tech deal. Michael seemingly at a time

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<v Speaker 1>where the markets falling gat a bed and increasingly the

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<v Speaker 1>doom and Gloom crew were coming on a program like

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<v Speaker 1>this talking about the prospect of a downturn. What's the

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<v Speaker 1>signal that comes from a deal like this this morning?

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<v Speaker 1>You know, you don't want to like take every deal

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<v Speaker 1>and say this definitely means something. I think it means

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<v Speaker 1>a lot for IBM for the overall technology market. It's

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<v Speaker 1>perhaps interesting, but Red Hat was willing to sell. You know,

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<v Speaker 1>maybe they felt that their own business was coming under pressure.

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<v Speaker 1>But I think technology has got to the point that

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<v Speaker 1>it's becoming increasingly competitive, increasingly oligopalistic um, and for the

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<v Speaker 1>first time, I think we have questions whether over the

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<v Speaker 1>medium to longer term, the large technology companies can keep

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<v Speaker 1>up with expectations. Are all ego bullies? How does IBM

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<v Speaker 1>adjust to that? And we get to the cow and

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<v Speaker 1>Jeffrey's headlines today in the Bloombird, where one of them,

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<v Speaker 1>I believe Cowen says we could see other bids even

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<v Speaker 1>at thirty one time, Zibadar or whatever, and Jeffreys saying,

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<v Speaker 1>no way. I mean there's a desperation out there in

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<v Speaker 1>cloud technology, isn't there. Well, I think it's viewed as

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<v Speaker 1>as the best way to make money from the corporate sector,

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<v Speaker 1>you know, going forward. And I think if the IBM

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<v Speaker 1>three six, do you have two thousand twenty two right? Yes?

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<v Speaker 1>You know whatever? That was his face I wish we

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<v Speaker 1>had wish Did you see that on radio? We need

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<v Speaker 1>you like brilliant Michael's face, Michael bar Did you see that?

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<v Speaker 1>She'll just killed me that? Yes? To last, you have

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<v Speaker 1>no idea John, how the pecking order at any firm

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<v Speaker 1>was whether you had an IBM typewriter. They were just

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<v Speaker 1>the coolest thing. Going back in the day. They were

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<v Speaker 1>the coolest thing. What going I couldn't type was this.

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<v Speaker 1>This is so far back I don't remember what decade,

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<v Speaker 1>But the point is it didn't even matter if you

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<v Speaker 1>could type. It was just cool. You still don't do

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<v Speaker 1>on your own typing even now. No, I don't do

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<v Speaker 1>my own type. Tom Kane, Happy, Tom Kine, Michael Shell,

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<v Speaker 1>Thank you, Michael, give me so much time to place

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<v Speaker 1>on TV and radio. Market Field Asset Management's chairman, portfolio

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<v Speaker 1>manager and CEO. We are honored to bring in Shannon

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<v Speaker 1>O'Neill of the Counsul and foreign relations or expertise in

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<v Speaker 1>Mexico and Argentine of course on all of Latin America

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<v Speaker 1>and Brazil. Dr Nil, wonderful to have you whe us

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<v Speaker 1>you speak of Mexico and America indivisible in your book?

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<v Speaker 1>Are Brazil and the United States? Is this new president

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<v Speaker 1>and President Trump? Are they indivisible? Well? I do think

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<v Speaker 1>that the new president elect would like to make them indivisible.

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<v Speaker 1>He's a big fan of President Trump and has talked

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<v Speaker 1>a lot about him and how he would follow him,

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<v Speaker 1>and also really touted the phone call he got from

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<v Speaker 1>President Trump last night in the congratulations within this, Shannon O'Neill,

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<v Speaker 1>is the comparison is to Mr deterity of the Philippines. Obviously, law, criminality,

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<v Speaker 1>corruption or front and center. In Brazil. Will there be

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<v Speaker 1>a crackdown to threaten civil liberties? This is what everyone

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<v Speaker 1>is expecting and what he has said over and over

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<v Speaker 1>during each campaign. Stop. Brazil is already a place where

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<v Speaker 1>the police kill somewhere around five thousand individuals every year,

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<v Speaker 1>and so expect those numbers to go up, just as

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<v Speaker 1>they did in the Philippines. The commitment to liberalize and

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<v Speaker 1>privatize is something the markets have really focused on over

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<v Speaker 1>the last few months or so. Shannon, just how strong

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<v Speaker 1>is that commitment? How fluid is that commitment? Well, this

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<v Speaker 1>is a big question because the president elect Bosnao has

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<v Speaker 1>never been a big privatizer, he's voted against it during

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<v Speaker 1>his almost thirty years within the Congress. But his economic

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<v Speaker 1>advisor is a very strong privatizer, very orthodox Econ missed,

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<v Speaker 1>and he's hinted that he will give him free reign.

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<v Speaker 1>So which Billsonaro, which government shows up will be a

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<v Speaker 1>big question. And Shannon, this is the issue. The narrative

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<v Speaker 1>around Bolsonaro, This economic narrative is recent, it's vague and

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<v Speaker 1>it hinges on this one individual. Talk to me a

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<v Speaker 1>little bit more about this one individual that is going

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<v Speaker 1>to be shaping economic policy in Brazil, that ultimately is

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<v Speaker 1>the economic policy that the market has gone behind. Well,

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<v Speaker 1>he's a very strong personality, very set in these beliefs,

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<v Speaker 1>very orthodox economists along the University of Chicago lines. So

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<v Speaker 1>in that sense, he's very pro market. The question is,

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<v Speaker 1>as you say, he's new to the Billsonaro team, and

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<v Speaker 1>so will he really have his trust, will he have

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<v Speaker 1>the power to go forward? And one thing that was

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<v Speaker 1>said in the last couple of days is that he

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<v Speaker 1>will report to Bilsonaro's chief of staff, so suggesting he

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<v Speaker 1>might not have that direct line to the new president. Shannon,

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<v Speaker 1>within your expertise of Latin America, how discreet is Brazil

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<v Speaker 1>or are there more linkage? Is than we understand with

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<v Speaker 1>the adjacent nations and even with Mexico. Brazil is the

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<v Speaker 1>biggest economy in in the hemisphere outside of the United States.

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<v Speaker 1>It has a lot of trade with the microsar partners, Argentina, Uruguay, Paraguay.

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<v Speaker 1>It has the possibility of being a regional and a

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<v Speaker 1>bigger global leader We've seen that at various moments along

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<v Speaker 1>the way, um, and it is important for what's going

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<v Speaker 1>on in Venezuela also its neighbor, and we'll see whether

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<v Speaker 1>the new president takes a leadership role on the crisis

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<v Speaker 1>that's happening there. What's the linkage of the military or well,

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<v Speaker 1>let me rephrase this in my ignorance, what is the

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<v Speaker 1>linkage of the military slash police with this new president. Well,

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<v Speaker 1>he was an army captain many many years ago, but

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<v Speaker 1>he's a huge official and not a huge fan of

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<v Speaker 1>the military. He likes to talk in that language. He

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<v Speaker 1>likes to talk about giving the police a free reign.

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<v Speaker 1>So expect a much more milit terries state in many ways.

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<v Speaker 1>We also saw several ex military office brought in as

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<v Speaker 1>governors or as members of Congress, So you're gonna see

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<v Speaker 1>more of this rhetoric within the new political class. Shannon,

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<v Speaker 1>Thank you so much. Shannon on the old console on

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<v Speaker 1>foreign relations, can't say enough about two nations indivisible. It

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<v Speaker 1>has aged well out four or five years ago. Two

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<v Speaker 1>nations indivisible Mexico, the United States, and the road ahead

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<v Speaker 1>is wrong. Let us pause with Neil sharing of Catholic anomics,

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<v Speaker 1>you can do that. He's he's really really quite good,

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<v Speaker 1>spanning from e M to developed countries as well. Neil,

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<v Speaker 1>if you were to write a report today, what would

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<v Speaker 1>you focus on in the capital economics mix? Well, that's

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<v Speaker 1>the question. There's just so many things going on. I

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<v Speaker 1>don't want to predetermine it. What which right There's There's

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<v Speaker 1>obviously lots of strands that we that we we do

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<v Speaker 1>tend to focus on. There's the trade war. To what

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<v Speaker 1>extent is that going to escalate? To what extent that's

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<v Speaker 1>is that going to kill the global economy. There's the

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<v Speaker 1>risk of the political fragmentation, rise of populism, economic nationalism

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<v Speaker 1>and parts of the world, including with the news of

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<v Speaker 1>Bosonara's victory in Brazil over the weekend. And the big

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<v Speaker 1>question to my mind though, is to what extent how

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<v Speaker 1>much longevity is there in the US recovery. To what

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<v Speaker 1>extent does the cumulative effects of previous FED rate rate hikes,

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<v Speaker 1>FED tightening, Well, when does that start to bite? When

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<v Speaker 1>does the fiscal sugar high from the tax cuts earlier

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<v Speaker 1>this year start to fade? And that's the big puzzle,

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<v Speaker 1>because that's the it's the US that stands out at

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<v Speaker 1>the moment every most other parts of the globe economy

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<v Speaker 1>is slowing US. The dollar dynamics is the guess of dollardics. Yeah,

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<v Speaker 1>which people have got wrong for two years wrong, two

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<v Speaker 1>years running. Now Tom looking for a stronger and they

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<v Speaker 1>get a weaker. They look for a weaker and they

0:13:05.520 --> 0:13:09.080
<v Speaker 1>get a stronger. That's been the story of Neil. Really

0:13:09.160 --> 0:13:13.719
<v Speaker 1>fascinating interview with Jeff Gunlag very recently on on Citywire.

0:13:13.920 --> 0:13:15.720
<v Speaker 1>It was really really interesting and he talked about what

0:13:15.720 --> 0:13:18.520
<v Speaker 1>he looks for in the economic data and either the

0:13:18.600 --> 0:13:22.680
<v Speaker 1>data changes or people's interpretation of that data changes. Has

0:13:22.720 --> 0:13:25.560
<v Speaker 1>the data changed or if people just started to interpret

0:13:25.600 --> 0:13:29.800
<v Speaker 1>the data differently another good question. I think that there

0:13:29.880 --> 0:13:32.600
<v Speaker 1>is genuinely a sense I think in the last six

0:13:32.640 --> 0:13:34.959
<v Speaker 1>months that the economic data outside of the US have

0:13:35.040 --> 0:13:38.920
<v Speaker 1>started to soften. We see that not just in the

0:13:38.960 --> 0:13:41.400
<v Speaker 1>soft data, the survey data, the p m s and

0:13:41.400 --> 0:13:42.839
<v Speaker 1>so on and so forth. We see in the hard

0:13:42.920 --> 0:13:46.320
<v Speaker 1>days of some trade data slowing, industrial productions weaker. Pretty

0:13:46.360 --> 0:13:49.280
<v Speaker 1>much across the board. Japan's economy looks like it looks

0:13:49.320 --> 0:13:52.800
<v Speaker 1>like it contracted in Q three, and China's economy is

0:13:52.840 --> 0:13:55.880
<v Speaker 1>losing momentum. Too, So I think there is something tangible

0:13:55.920 --> 0:13:58.679
<v Speaker 1>in the in the data. The puzzle that you as

0:13:58.679 --> 0:14:00.680
<v Speaker 1>you alluded to earlier is that we've not yet seen

0:14:00.760 --> 0:14:03.120
<v Speaker 1>signs of wage pressure picking up in the countries where

0:14:03.120 --> 0:14:05.120
<v Speaker 1>the labor market is a titan. Growth is still strong,

0:14:05.240 --> 0:14:09.720
<v Speaker 1>particularly the US and in the U k UM And

0:14:09.800 --> 0:14:11.800
<v Speaker 1>that's that. I think that's the that's the that's the

0:14:11.800 --> 0:14:14.480
<v Speaker 1>missing piece of the jig saw so far. No, very quickly,

0:14:14.559 --> 0:14:17.360
<v Speaker 1>you're you were with us earlier we talked about China

0:14:17.480 --> 0:14:20.880
<v Speaker 1>slowing down. What is China growth right now? In capital

0:14:20.960 --> 0:14:23.960
<v Speaker 1>economics and conder, I say, we get a print below

0:14:24.080 --> 0:14:27.280
<v Speaker 1>six point zero percent, we you can. We have our

0:14:27.320 --> 0:14:30.320
<v Speaker 1>own in highse measure China activity proxy that's kind of

0:14:30.360 --> 0:14:32.960
<v Speaker 1>running at the moment about five and a half five's

0:14:33.000 --> 0:14:35.120
<v Speaker 1>something like that. It got to as low as just

0:14:35.200 --> 0:14:40.040
<v Speaker 1>below four at the end of twenty fifteen, started sixteen,

0:14:40.080 --> 0:14:41.640
<v Speaker 1>which if you remember, that's when he had the botched

0:14:41.680 --> 0:14:45.520
<v Speaker 1>evaluation and big slow down in China's economy, subsequent recovery

0:14:45.520 --> 0:14:48.840
<v Speaker 1>field by policy stimulus that's now fading ah and growth

0:14:48.880 --> 0:14:51.480
<v Speaker 1>of stowing. Accordingly, just quickly, what are you looking for

0:14:51.520 --> 0:14:55.840
<v Speaker 1>on Friday? We've got five think the consensus is one

0:14:56.120 --> 0:14:59.160
<v Speaker 1>three something around that. The key will be what happens

0:14:59.200 --> 0:15:01.880
<v Speaker 1>with the way number? Is there a further sleervation in

0:15:01.960 --> 0:15:04.120
<v Speaker 1>wage growth? How does the fetch reacts? How does it

0:15:04.200 --> 0:15:06.920
<v Speaker 1>went bound? Stop against the tamil that we see actually

0:15:06.920 --> 0:15:10.880
<v Speaker 1>office stops the pause bubbles now sharing, thank you so

0:15:10.960 --> 0:15:22.880
<v Speaker 1>much as well with a new slow this morning. We

0:15:23.080 --> 0:15:26.480
<v Speaker 1>uh we did early early this morning the shocking headlines

0:15:26.680 --> 0:15:30.200
<v Speaker 1>coming out of Germany of Chancellor Miracle stepping down from

0:15:30.240 --> 0:15:33.680
<v Speaker 1>party leadership of her dominant c DU. This after a

0:15:33.800 --> 0:15:37.320
<v Speaker 1>troubled election in Bavaria a few weeks ago in Hessan

0:15:37.400 --> 0:15:41.080
<v Speaker 1>which is vis Boden and Frankfurt over the weekend, and

0:15:41.120 --> 0:15:44.600
<v Speaker 1>then really the major headline coming out of a end

0:15:44.640 --> 0:15:47.600
<v Speaker 1>or political career looking out two and three years. Nina

0:15:47.640 --> 0:15:51.040
<v Speaker 1>Schick is with Rasmussen. This is the Rasmusen of Denmark

0:15:51.080 --> 0:15:55.600
<v Speaker 1>in London. Uh, and we greatly appreciate her attendance uh

0:15:55.800 --> 0:16:00.280
<v Speaker 1>this morning. Nina. Is it an analysis out two and

0:16:00.440 --> 0:16:04.720
<v Speaker 1>three years of after the party's c DU, after the

0:16:04.800 --> 0:16:09.320
<v Speaker 1>party's CPD, or can these two dominant parties find a

0:16:09.440 --> 0:16:14.960
<v Speaker 1>new path in domestic Germany. I think they don't have

0:16:15.040 --> 0:16:17.680
<v Speaker 1>a choice. They have to find a new pass. And

0:16:17.680 --> 0:16:20.480
<v Speaker 1>the thing is that Angela Merkel has been such a

0:16:20.640 --> 0:16:25.200
<v Speaker 1>monolith not only in terms of domestic politics in Germany,

0:16:25.200 --> 0:16:30.160
<v Speaker 1>but also in terms of EU politics and also global politics,

0:16:30.200 --> 0:16:33.160
<v Speaker 1>that filling that space, that void that she's going to

0:16:33.200 --> 0:16:36.360
<v Speaker 1>live behind, is going to inevitably going to cause a

0:16:36.360 --> 0:16:40.400
<v Speaker 1>little soul searching and blood letting in her parties. And

0:16:40.720 --> 0:16:44.480
<v Speaker 1>although I think she's setting setting the stage for her departure,

0:16:44.520 --> 0:16:47.360
<v Speaker 1>which by the way, I would argue was always going

0:16:47.400 --> 0:16:50.320
<v Speaker 1>to be the case, given her performance in the national

0:16:50.320 --> 0:16:54.800
<v Speaker 1>election in seventeen and the subsequent regional elections where we've

0:16:54.800 --> 0:16:57.600
<v Speaker 1>seen her parties her both her party and the other

0:16:57.680 --> 0:17:01.160
<v Speaker 1>traditional kind of center left Mains Treen Party being hammered.

0:17:01.360 --> 0:17:04.560
<v Speaker 1>I would argue that this is inevitable. And the bigger

0:17:04.600 --> 0:17:07.719
<v Speaker 1>trend of what we're seeing in Germany is something that

0:17:07.760 --> 0:17:11.560
<v Speaker 1>we see across the liberal western democratic world, where the

0:17:11.680 --> 0:17:15.000
<v Speaker 1>center cannot hold anymore and politics is becoming more and

0:17:15.080 --> 0:17:19.760
<v Speaker 1>more polarized, noisy, and increasingly fractured. That's something we see

0:17:19.800 --> 0:17:22.080
<v Speaker 1>in Germany with the rise of the far right a

0:17:22.200 --> 0:17:25.840
<v Speaker 1>f T but also with the Greens, both of whom

0:17:26.400 --> 0:17:30.960
<v Speaker 1>present you know, a diametrically opposing vision of Germany and

0:17:31.040 --> 0:17:34.919
<v Speaker 1>what Germany's place in the world should be. Wondering, you know,

0:17:34.960 --> 0:17:38.440
<v Speaker 1>if there are any sort of likely candidates to fulfill

0:17:39.080 --> 0:17:41.800
<v Speaker 1>Uncle and Merkel's role as head of the party, for example,

0:17:41.800 --> 0:17:47.480
<v Speaker 1>the health minister Yen's spawn. Well, so the first thing

0:17:47.520 --> 0:17:50.880
<v Speaker 1>I should mention is that Michael has said that she's

0:17:50.920 --> 0:17:53.560
<v Speaker 1>going to step down from the party's leadership, but she's

0:17:53.560 --> 0:17:56.560
<v Speaker 1>still technically saying that she's going to serve out the

0:17:56.600 --> 0:18:00.480
<v Speaker 1>full tenure as chancellor leading into one. But again I

0:18:00.520 --> 0:18:03.840
<v Speaker 1>think what she's doing stayed, you know, setting the scene

0:18:03.880 --> 0:18:06.920
<v Speaker 1>for an early exit, so big question mark about whether

0:18:07.040 --> 0:18:10.040
<v Speaker 1>or not you will actually stay until twenty one. But

0:18:10.200 --> 0:18:13.960
<v Speaker 1>she's not leaning leaving imminently. As to her successor, well

0:18:14.000 --> 0:18:17.000
<v Speaker 1>that's where it gets a bit complicated because Angela Mackel

0:18:17.040 --> 0:18:20.200
<v Speaker 1>herself was you know, a proponent or even a student

0:18:20.280 --> 0:18:23.680
<v Speaker 1>of helmwou Cool, you know, the former chancellor, and under

0:18:23.720 --> 0:18:26.960
<v Speaker 1>that school of thought, she looked very good at eradicating

0:18:27.119 --> 0:18:30.680
<v Speaker 1>any potential successor when they started getting a bit too powerful,

0:18:30.720 --> 0:18:33.240
<v Speaker 1>a bit too close for her. So there aren't very

0:18:33.280 --> 0:18:36.600
<v Speaker 1>many obvious candidates. Well, of the few people that are

0:18:36.640 --> 0:18:40.639
<v Speaker 1>being touted, like Jen Spahn or Anne mcgrad kavan Bower,

0:18:40.720 --> 0:18:44.240
<v Speaker 1>who is known as almost a mini Mercle. I think

0:18:44.280 --> 0:18:46.760
<v Speaker 1>that it is a poison chalice because she has been

0:18:47.240 --> 0:18:51.399
<v Speaker 1>such a bemus in German and global politics that being

0:18:51.480 --> 0:18:54.040
<v Speaker 1>her successor, and make no mistake, she's still going to

0:18:54.160 --> 0:18:57.719
<v Speaker 1>have a say on who her successor is. Being her

0:18:57.760 --> 0:19:01.640
<v Speaker 1>successor might be too toxic long term politically, because they'll

0:19:01.680 --> 0:19:04.320
<v Speaker 1>be so tight to Angela Mackael. And you know, the

0:19:04.359 --> 0:19:07.399
<v Speaker 1>older generation of the city who be it Machael or

0:19:07.440 --> 0:19:11.400
<v Speaker 1>Wolcom Scheibler, that their own political career might not last

0:19:11.440 --> 0:19:14.080
<v Speaker 1>too long. So you have a younger generation of politicians

0:19:14.119 --> 0:19:18.920
<v Speaker 1>who are coming up, including for example, who don't necessarily

0:19:19.000 --> 0:19:22.000
<v Speaker 1>immediately want to step into her shoes right now because

0:19:22.040 --> 0:19:23.760
<v Speaker 1>they want to make sure that they are able to

0:19:23.800 --> 0:19:27.159
<v Speaker 1>define themselves with something quite different from Machaels. So it

0:19:27.200 --> 0:19:29.919
<v Speaker 1>will take a few years. I think. As part of

0:19:29.920 --> 0:19:34.359
<v Speaker 1>your work at Rasmussen Global, you've looked at a variety

0:19:34.640 --> 0:19:39.480
<v Speaker 1>of campaigns. You also did some work on the UK's

0:19:40.000 --> 0:19:42.919
<v Speaker 1>EU referendum. Do you believe that there will be a

0:19:42.920 --> 0:19:50.000
<v Speaker 1>new government in the UK. Well, British politics is very

0:19:50.080 --> 0:19:52.719
<v Speaker 1>precarious right now, and I think that you know. On

0:19:52.720 --> 0:19:55.320
<v Speaker 1>a separate note, I think that we are seeing a

0:19:55.320 --> 0:19:59.960
<v Speaker 1>lot of kind of disciplines or should we say company

0:20:00.000 --> 0:20:02.560
<v Speaker 1>located politics around the world, which I think has is

0:20:02.680 --> 0:20:05.320
<v Speaker 1>something much larger to do with the state of democracy

0:20:05.359 --> 0:20:07.399
<v Speaker 1>in the world order, which was built in the ashes

0:20:07.440 --> 0:20:09.920
<v Speaker 1>of the Second World War, and how that's all being offended,

0:20:10.200 --> 0:20:12.639
<v Speaker 1>not least because of what's happening in the United States.

0:20:13.160 --> 0:20:17.280
<v Speaker 1>With regards to the UK in particular, the biggest challenge

0:20:17.680 --> 0:20:19.919
<v Speaker 1>that the government and the Prime Minister Trees that may

0:20:19.960 --> 0:20:22.719
<v Speaker 1>have on their hands right now is to get the

0:20:22.760 --> 0:20:26.320
<v Speaker 1>Brexit deal through Parliament. They've already kind of agreed the

0:20:26.359 --> 0:20:28.520
<v Speaker 1>deal on the EU level, and what we've been in

0:20:28.560 --> 0:20:31.000
<v Speaker 1>the past two years is that the UK has come

0:20:31.040 --> 0:20:34.000
<v Speaker 1>around this easy position of thinking. But if they don't

0:20:34.000 --> 0:20:37.280
<v Speaker 1>get that through the government may okay. But in Germany

0:20:37.359 --> 0:20:40.440
<v Speaker 1>and in England it pends. Good question, and you're wonderful

0:20:40.480 --> 0:20:44.800
<v Speaker 1>answer and informed answer is the reality at the ballot

0:20:44.840 --> 0:20:50.480
<v Speaker 1>box people are voting. When does this populism trend end,

0:20:50.600 --> 0:20:54.920
<v Speaker 1>whether it's Poland or Germany, or England or frankly Kentucky

0:20:54.960 --> 0:20:58.879
<v Speaker 1>in eight days, when does populism end? I don't I

0:20:58.920 --> 0:21:02.280
<v Speaker 1>don't see a rash all outcome for the elites other

0:21:02.320 --> 0:21:07.359
<v Speaker 1>than it keeps going. I tend to agree with your analysis.

0:21:07.359 --> 0:21:10.760
<v Speaker 1>Third home, I think that this is very much the

0:21:10.760 --> 0:21:14.199
<v Speaker 1>trajectory of politics that we're going to be seeing in

0:21:14.240 --> 0:21:19.600
<v Speaker 1>the years to come, a highly emotive, partisan and destructive

0:21:19.600 --> 0:21:24.440
<v Speaker 1>and angry politics, in part because I think that democracy

0:21:24.520 --> 0:21:27.360
<v Speaker 1>quote unquote has failed for a lot of people. And

0:21:27.440 --> 0:21:30.000
<v Speaker 1>this kind of anger that you see not only in

0:21:30.080 --> 0:21:33.439
<v Speaker 1>the United States but also across Europe means that the

0:21:33.560 --> 0:21:37.840
<v Speaker 1>narrative that we've told ourselves in particular with the United

0:21:37.880 --> 0:21:41.520
<v Speaker 1>States as well, that open markets, liberal democracy, and capitalism

0:21:41.560 --> 0:21:43.840
<v Speaker 1>go hand in pans, and that this is some kind

0:21:43.840 --> 0:21:46.359
<v Speaker 1>of linear progress to which all of the rest of

0:21:46.359 --> 0:21:47.960
<v Speaker 1>the countries in the world are going to aspire to.

0:21:48.520 --> 0:21:52.240
<v Speaker 1>That very narrative is being challenged. And what we find

0:21:52.359 --> 0:21:56.480
<v Speaker 1>is that liberal democracy is no longer the UH is

0:21:56.520 --> 0:21:59.320
<v Speaker 1>no longer the aspirational model for everyone in the world,

0:21:59.480 --> 0:22:03.480
<v Speaker 1>but it's actual She's becoming an exception, and there is

0:22:03.600 --> 0:22:06.719
<v Speaker 1>valid criticism to be made, you know, there's valid criticism

0:22:06.800 --> 0:22:11.520
<v Speaker 1>of the liberal elites um and I tend to agree

0:22:11.520 --> 0:22:13.560
<v Speaker 1>with you that this is something we're going to speak

0:22:13.880 --> 0:22:16.240
<v Speaker 1>playing out heavily in the next few years. Nina and

0:22:16.320 --> 0:22:18.280
<v Speaker 1>Short Notice, thank you as so much. Share with rast

0:22:18.320 --> 0:22:21.480
<v Speaker 1>Miss of Denmark in England helping out this morning on

0:22:21.800 --> 0:22:29.680
<v Speaker 1>European News. Thanks for listening to the Bloomberg Surveillance podcast.

0:22:30.040 --> 0:22:35.000
<v Speaker 1>Subscribe and listen to interviews on Apple Podcasts, SoundCloud, or

0:22:35.160 --> 0:22:39.400
<v Speaker 1>whichever podcast platform you prefer. I'm on Twitter at Tom

0:22:39.560 --> 0:22:43.440
<v Speaker 1>Keane before the podcast. You can always catch us worldwide.

0:22:43.880 --> 0:22:44.960
<v Speaker 1>I'm Bloomberg Radio.